IRS Collection Efforts

If you owe back taxes, the IRS can try to collect them anytime within 10 years. The statute of limitations for IRS tax debt is a decade, which gives them plenty of time to try to get the money out of you. If you do not pay the taxes that you owe, the Internal Revenue Service can seize your assets, take money out of your bank account or set up a wage garnishment on your earnings. The IRS can also place a lien on your property so that you cannot sell it without paying back the debt you owe. Tax debt is traditionally not something that will just go away and you’ll have to face it head on if you want to handle it.

Installment Agreement

If you do not have the money that you need to pay the taxes that you owe, one option to consider is an installment agreement. The IRS offers several installment agreements or payment plans to allow you to pay off your debt over time. Most of them give you at least three years of monthly payments to pay back what you owe. In some cases, the installment agreement can be extended to an even longer term. Most taxpayers can automatically qualify for an installment agreement simply by filling out an IRS form.

Negotiation

Another option that you may want to consider in this situation is an offer in compromise. With an offer in compromise, you agree to pay an amount that is less than what you owe in the form of a lump sum. With this approach, you can pay off your debt quickly and the IRS will simply forgive the rest of the amount you owe. The IRS does not always accept these proposals and will only do so if they feel that they will not be able to collect the rest of the money that you owe for some reason.

Loan

If you do not want to set up an installment agreement or you can qualify for an offer in compromise, another option to consider is a loan. With this approach, you borrow the money that you need to pay off your taxes from an outside source and then use that money to handle your debt with the IRS. Then you start making payments to your lender until the debt is gone.

If you owe back taxes, do not try to hide from the IRS and hope the problem disappears. Look for a legitimate solution and get rid of the debt that you owe.

Do you need help with back taxes? Call Tax Resolution Centre today and consult with one of our many experienced tax accountant Toronto to help you with your tax issues.

Image Credit

The good news is that the IRS has pushed the filing date back to April 17th! The bad news is that tax preparers are busy and it may be difficult to get help in a timely manner. Lucky for you, I’ve pulled together a few tips to help this most dreaded of chores pass by smoothly.

Paper Work

Whether you are filing your taxes on your own or hiring a professional, you will need to have certain items at your disposal. It’s a good idea to gather all of them at once so you don’t have to go searching for them while you are in the process of completing the tax forms.

• Last year’s tax return
• All W2s and 1099 forms that you received.
• Relevant receipts for charitable donations, childcare and medical expenses and any that you have for your business (if applicable).
• Statements from all investments and bank accounts.
• Social security numbers for you, your spouse and your dependents.
• Your dependents’ social security numbers.

Tax Preparation Options

Before you can file, you’ll need to decide which way you are going to do it. Gone are the days of the dozens of forms that you need to fill out with pencil. Your options include online software and tax preparers in most strip malls as well as a tax professional that you hire to do the work for you.

Online Options include TurboTax, Tax Act and H&R Block at Home. Each of these will prompt you to fill in the necessary areas of the tax forms. They will also do all the calculations for you (No more worries that you added wrong.) as well as prompt you for any deductions that you may have missed. All will file your taxes for you (in some cases for free) at a relatively low rate compared to the cost of a tax preparer. Each site also offers tips for filing last year’s taxes as well as preparing for this year’s in advance.

If your income is less than $58,000 you may be able to use the free version of these programs. Check out the IRS’s website for further information on FreeFile.

If you don’t think you will be able to complete your taxes by the April 17th deadline, check out the IRS website for tips on how to file an extension.

Photo Credit

Article from Nick Zapolski..

In our lives we all have to make some big decisions.  Things such as going to university or not, buying property, getting married, having children, etc, for many of us, are huge decisions to be made.  Accepting a job offer, moving/relocating to a new town or even country, again, big decisions to be made. And when we make our choices in these matters, many of us will research and get advice as so we can make an informed decision; the best choice and decision for us of 8000 pages of information post and pre bankruptcy.

For many people who are experiencing financial difficulties, getting proper, professional advice is also something they research and need assistance with in making a decision.  That decision is what to do, or what can I do to sort out my financial and debt mess.

Being in debt and struggling is a very stressful and difficult time.  Perhaps one of the most stressful times of our lives. It is in this period of stress that we can be vulnerable and susceptible, and possibly misled in our decisions of what we can and cannot or should and should not do.

This is especially true when making the decision as to go bankrupt or not.

Guy at bankruptcy.org says that a large number of people that visit our web site come there for information.  They are researching the possibility that they may need to go bankrupt and they want to know what will happen.  Our site offers a wealth of information they can sort through, in addition to being able to not just ask a question of an advisor, but also read other people’s stories and experiences through our forum.

In researching insolvency and bankruptcy, there are many, many web sites and companies out there offering help and assistance; and it can be a bit daunting in figuring out which one is what and who to ask what question.

But the main thing is that the research is done, and a person gets the advice they need, so that going into something as major as going bankrupt, is done with the knowledge of the process and how it will relate to that person’s specific circumstance.

I particularly like the idea of the public forums such as on the web site bankruptcy.org.uk.  This is a place where not only can someone ask a question, but also read other people’s stories and share in their experiences of how bankruptcy was for them.  This is powerful stuff for someone thinking about and needing to make a decision such as going bankrupt.  It is also a place where someone who has gone bankrupt can feel they are helping another person by sharing their experience, but also now by being experienced, they can advise others.  It can be an empowering thing, especially as many feel powerless when they have to go bankrupt.

So I say, as with any major life choice or decision, get professional advice on as to if bankruptcy is the best option for you, and also, know how it will relate to your unique set of circumstances and your life.

Depending on whether you are required to cough up some unexpected tax money or you are owed a refund, tax season can either seem like doomsday or like Christmas in April. Even though most people dread the filing process, it is more than worth it to discover that you have a sweet refund check headed your way afterwards. What you choose to do with that money is up to you—use it for a tropical vacation, buy yourself a new gadget, or improve upon that credit score and put it towards chipping away at your debt. What I want to share with you are some tips for getting the most out of your tax return, and to remind you of certain tax credits that you might not be aware you are eligible for.

1. Put some money into that IRA while you still can

First of all, if you don’t already have an Individual Retirement Account (IRA), I cannot urge you strongly enough to open one. I personally put a lot of weight on preparing for the future, and it sounds corny but it really is never too soon to start. Even if you don’t have one, read on to learn how it can be to your tax advantage to open one. If you do already have one, give yourself a pat on the back and remember that one of the easiest ways to increase the chances of a tax return are contributing to your IRA. The money that you put into an IRA is non-taxable, so the more you put in, the lower your total taxable income is. Publication 590 on the IRS’ website states, Contributions can be made to your traditional IRA for a year at any time during the year or by the due date for filing your return for that year. Because April 15, 2012 falls on a Sunday and Emancipation Day falls on Monday, April 16, 2012, the due date for making contributions for 2011 to your IRA is April 17, 2012. I recommend taking advantage of the extended deadline and increasing your shot at a bigger tax return.

2. Collect on EITC

EITC stands for the Earned Income Tax Credit, and is designed for people who make less than $49,078 annually to give them a boost. I stress looking into this tax credit this year more than ever, in light of the past couple of years’ downtrodden economy. I have a hunch there are lots of workers out there whose earnings dropped last year, and who will therefore qualify though they might not have in previous years. Even if you are skeptical that you will qualify, it doesn’t hurt to check. The Salt Lake Tribune reported that last year 26.8 million American taxpayers received a whopping $59.5 billion in EITC, with the average EITC refund clocking in at $2,200. But an estimated one out of five eligible workers and families still miss out on the tax credit because they either didn’t claim it or didn’t file a tax return. Don’t be that one in five. It only takes a few minutes online to see if you qualify, and you can’t get any money back if you don’t try. IRS Publication 596 is the place to go to check out this little baby. It is dependent on income, age, and number of children you have, so punch in the honest answers to all questions and see if you’re eligible.

3. Take Advantage of Free preparation assistance

The IRS stated that during the 2012 tax season, more than 12,000 free tax preparation sites will be available throughout the U.S. to provide aid to low and moderate-come taxpayers and families and the elderly. The IRS provides a tab on the homepage of their website titled Help for Taxpayers, which includes a page dedicated to helping taxpayers find out if they qualify for free tax return preparation. The two main organizations working to provide free tax help to eligble taxpayers are the Volunteer Income Tax Assistance (VITA) and the Tax Counseling for the Elderly (TCE). VITA offers tax help for those whose annual salary is less than $50,000 and TCE gives free aid to priority assistance taxpayers who are above the age of sixty.

4. Report those Donations- they add up!

Step one, obtain a receipt for all charitable donations including cash donations, household items and clothes. The receipt should list, in some form, a description of the donation, amount (if cash), items donated (if non-cash), your name, and the date donated. It can be tough to figure out the value of donated goods, to Goodwill or the Salvation Army for example. The Salvation Army has a nifty guideline to determine the value of such donations, for everything from women’s clothing, to furniture, to sporting goods. So step two should be making a list of all donated goods, and figuring out their estimated value, which might turn out to be worth more than you thought. A further heads up, if you haven’t been claiming contributions to your kids’ schools, Boy Scouts, and church, you should start! Some people also miss deducting the miles driven and other travel costs associated with volunteering. Things that you may NOT deduct include money donated to profit organizations, money given to a political campaign/party, or putting a price tag on the time you spent volunteering.

5. Check out these 3 Tax Credits to see if you’re Eligible

Dependent on your personal situation, you may or may not be eligible for the following three credits: Child and Dependent Care Credit, Child Tax Credit, and Retirement Savings Contributions Credit. The Child and Dependent Care Credit (IRS Publication 503) is for expenses paid for caring for children who are under 13 years old, (or for a disabled spouse/dependent), while you are either working or looking for work. The Child Tax Credit (IRS Publication 972) is for parents who have a qualifying child or children, and can definitely be claimed in addition to the Child and Dependent Care Credit. Lastly, the Retirement Savings Contributions Credit, aka the Saver’s Credit, (IRS Publication 590) is aimed at helping low/moderate income workers save up for their retirement fund. You might qualify if your income is below a certain limit and you actively contribute to an IRA or 401(k). Like I said before, if you have never qualified for these credits before, it’s worth a look if your financial, work or marital situation has changed over the past year.

Dk is an avid finance blogger. You can check out more of his stuff on Roadfish.com

Did you know that the average refund distributed during tax season is almost $3,000? Most of the time, that refund will go right into a savings account, but there are other ways to spend a tax refund that can boost your refund for next year, and no, it doesn’t include going on vacation or a shopping spree. The ways to super charge your tax refund are discussed in Cheap Sally’s The Smarter Way To File Your Taxes. Cheap Sally goes in depth into various topics about taxes, such as reasons to hire a tax pro, three online tax preparation services that are worth looking into, the estimated time burden needed to file your taxes, as well as deductions that are commonly missed each year. Filing your taxes just got easier with this helpful guide, and with proper preparation and organization, you’ll have your tax return filed in no time at all! CheapSally.com recommends using a coupon code when shopping online. Get the embed code here.

What is bankruptcy?

The word bankruptcy comes from two old Latin words: bancus (a bench or table, much like those used by the very first bankers) and ruptus (broken; a banker would literally break his bank in order to indicate that it was no longer in any fit condition to do business). It denotes the legal status of a person who cannot afford to repay their debts to their creditors. Not surprisingly, this can cause significant problems if you are trying to get credit.

What are your options if you are bankrupt?

If your discharged bankruptcy and any other things that might adversely affect your credit history (such as country court judgements) happen to have been incurred more than five years ago then a credit card is likely to be a very legitimate option for you. It is still possible to get one while paying off past credit, but your credit rating will be checked in order to find out whether you often miss payments or make them late, as well as how much debt you are in and how much you are paying out for it.

What is taken into account if you apply for a credit card after being declared bankrupt?

• Credit rating – Self explanatory.
• Current level of debt - Otherwise known as indebtedness.
• Bills and other payments – As well as utility bills and similar, lenders will often take note of how much you pay towards your existing debts each month.

Using credit expert websites in order to check your credit score can really help in you keep track. You can even write to the credit reference agency if you dont have access to the internet, email or a computer; they are obligated to reply to you within seven days.

Bad credit history credit cards have higher interest rates and lower credit limits than their mainstream counterparts. However, these are a far better option as you have far less risk of rejection as well as an opportunity to rebuild your credit rating over time. Prepaid credit cards are also a good option for those who have been declared bankrupt, giving you a small loan of sorts while helping to repair your credit rating as you pay your monthly fees.

Fabio Webb agrees that the careful use of credit cards after bankruptcy can help you build up a better credit score.

African Potato Mashers

Bafia potato mashers were used to, surprisingly, mash potatoes; they were also used as old currency. In ancient Cameroon, these heavy potato mashers weren’t in supply by the large and were therefore reserved for affluent members of the community. That is why it was perfect for trading power and currency. In fact a Bafian wife would set you back approximately 30 Bafia potato mashers; which begs the question, “Any potato mashers left for the kitchen?” In all seriousness though, the value of old currency is still quite measurable using a bit of research in anthropology. As a bonus, relatively nearby Mali used to use copper and metal snakes as old currency which I would imagine would scare any potential wife you’re in the market for away.

Asian Knife Collections

Meanwhile in Asia, if a mugger ever attempted to rob someone he would have a much harder time making a clean getaway. The first ever form of old coins and currency in China came in the form of knifes; a great defence against an impoverished mugger would be a wallet full of weapons I would imagine. One such knife looked like a barber’s razor which can only give new meaning to the phrase ‘slashing prices.’ Less dangerous was the Egyptian form of old currency exchange which was quite simply jewellery. If you wanted to buy a chariot or Nile raft, all you needed to do was produce a necklace or gold ring with which to give in exchange. Not quite old British currency, one could only imagine how many pyramids one could buy with the Crown Jewels.

A Potluck or Potlatch

Finally, North American Indians seemed to have an old currency of their own long before the first settler hit the east coast. A potlatch ceremony would be similar to a church fete in that people would bring old junk and go home with new junk. The exchange of everything from Orca teeth to hawk beaks would happen as rarer items had stronger values attached to them. One could argue this was simply bartering but there was real value attached to individual items so it was more or less systematic thereby transcending the traditional bartering. Old currency may have been more fun to exchange than paper or coins, but it would take a marketing genius to figure out any sort of Forex system attached to a single Orca tooth.

Eugene Calvini is a writer and currency enthusiast; as a FX broker armed to the teeth with a successful FX account, he enjoys looking at currency from an anthropological point of view.

Spending within your means is the foundation of financial security and if more people had been living within their means, there would be less financial devastation in the wake of the Global Financial Crisis. One parent in a two income family losing their job shouldn’t mean that the family loses their home too, however, when you are spending everything you earn to pay the mortgage one a big house and fill that house with new and expensive things, and park new and expensive things in the driveway, then losing one income leaves you strapped for cash.

Therefore, instead of living beyond your means, you should be looking for ways you can cement your financial security through carefully invested savings. To do this, you need to make sure you choose the best high interest savings account, so look for the following features as you compare accounts:

The right interest rate

The interest rate will be one of the most important factors in growing your online savings, but choosing the right interest rate is about more than simply choosing the highest rate at the time you are applying. The interest rate paid by an online savings account is variable, meaning it is set by the financial institution and adjusted when they make changes to their standard interest rates in response to official interest rate changes. This means your savings interest rate can go up if the bank raises their rate, but it can also go down and earn you less interest.

In some cases there are additional conditions on your savings interest rate, which can be made to work in your favour if you know what you are looking for:

• Interest based on withdrawals. Another way to enforce your savings and encourage you from not taking your savings from your account is a bonus interest rate paid on a month you don’t make any withdrawals. This works in a similar way to the minimum balance bonus interest and can be a way for you to earn more interest and stick to your savings goals.
• Promotional interest rate. Banks will run specials to attract customers in the same way department stores do, so you have the opportunity to earn a higher rate of interest if you shop around for the best special. Promotional interest rates on online savings accounts typically run for six to 12 months, where you can either earn a fixed higher interest rate – for example 6.5% for 12 months – or a promotional bonus amount – for example an extra 1% for 12 months. The fixed promotional rate is a preferred option if it looks like interest rates are going to go down in the near future, however the bonus amount will be able to keep you ahead even with a few rate rises.

The right accessibility

With most bank accounts you are looking for one which is easy to access, however, with an online high interest savings account you want almost the opposite. If the money in your savings account is too easy to access you may be tempted to spend it when you’re out at the pub, or when you walk past a shoe sale, instead of holding onto that money which is supposed to be your emergency fund or your holiday fund. At the same time, the benefit of an online savings account is that your money is at call. At call means your money is not locked away as it would be with a term deposit, and can be accessed in a matter of days.

An online savings account works by linking to one of your existing transaction accounts. This means you can make transfers into your savings account from this transaction account using online banking, and you don’t need to visit a branch; this also saves you on fees. You also don’t want an online savings account with an ATM card, instead, you withdraw your money the same way you deposit it – through your transaction account.

When you reach your savings goal or need some emergency funds to repair the car, you transfer the money out of your online savings account and into your transaction account. If your linked transaction account is with the same financial institution as your online savings account, the transfer is likely to be instant. If you think that will be too tempting and easy to access for you, choose an online savings account from a different bank, as the transfer will take several days – enough time to pay for an emergency expense, but too long to pay for a shoe sale fix.

Your choice of online savings account may also come down to your existing banking relationships. Approach your existing bank and ask them about the best interest rate they can offer you as an existing customer. If you already have transaction accounts, credit cards, personal loans or a home loan then you may be able to negotiate a great deal, and enjoy easy access at the same time.

Fee free

By going online with your savings you are going fee free. This is possible because an online savings account is very easy for the bank to manage as they don’t need to spend teller hours or branch time helping you open the account, make deposits or withdrawals or check your balance – you can do all of that online yourself.

As a result, online savings accounts can be entirely fee free, with no application fees, no monthly fee and no transaction fees. If your online savings account and linked transaction account are from the same institution you can even make free deposits to your online savings account without them counting towards your transactions. There also shouldn’t be any fees for closing down your account, when you reach your savings goal, or if you find a better offer or want to follow high promotional interest rates.

Therefore, when you are comparing online savings accounts and you come across an account with any sort of fees, keep looking because there is a better deal out there.

No minimum deposit

As we’ve already discovered, an online savings account with a minimum deposit requirement can earn you bonus interest. However, if you are shopping around for your first high interest savings account, and you’re not sure how you will be using your account yet, it is best to look for an account which doesn’t require a minimum deposit to earn interest. There may however, be a minimum deposit required to open an account, but this will usually be a nominal amount such as $1 and is arranged as part of the online application process to establish the link between your transaction account and new savings account.

Ease of use and access

Saving money is hard enough without adding obstacles to your account, so it is important you choose an online high interest savings account which is easy to use and access when you need it. This means looking for the following features:

• Easy periodic deposits. The easiest way to keep to your savings goals is not to think about them. Instead, make sure you can set up an automatic deposit from your transaction account to your savings account each pay day. In this way you pay yourself first, you won’t miss the money and you don’t have to remember to make the transfer.
• Spending penalties. While it is important to put some sort of barrier between you and your savings to protect them from being impulsively spent, you also need to make sure that you know how to easily access the funds when you need them. This could be in an emergency, or you may simply be ready to book your holiday flights or pick up your new TV and you don’t want your savings efforts to be cancelled out by withdrawal fees or angst.
• Customer service. Many online banks are offered by direct banks, which don’t actually have any branches. However, many direct banks make up for this by having a 24 hour, seven day a week call centre, so you can contact them at any time, with any question.

These are the five most important things to look for when you are choosing an online savings account. The order of their priority and how much weight you place on each feature will depend on your savings goals and financial situation, so compare the features and the accounts, and don’t forget to turn the comparison back on yourself too.

Alban has been reviewing savings accounts at www.savingsaccountfinder.com.au for the last 3 years. He also contributed to several personal finance blogs.

Are you hopelessly in debt? Have you maxed out your credit cards and feel like you have nowhere to turn to? Is your net worth now in the negative? Don’t despair. There is a way to change your current situation. You can still turn things around and make it better. Let me reveal to you 4 steps on how to get out of debt – fast!

First, plug the hole. If there is a leak in your tub no matter how much water you put in, it can never be full unless you plug the leak. In the same way, in order to get out of debt find out why you are in debt in the first place. Track down your expenses and determine where the bulk of your money has been going. Has it been going to shopping sprees, eat outs or expensive vacations? Figure out where you are putting your money and take control.

Second, cut back. You are in debt because of one simple reason: you are spending more than you earn. No matter how much you earn your expenses will always be in proportion to your income. The solution to this is to live beneath your worth. Do not overspend. Cut back on unnecessary expenses. If you have been going to an expensive gym then opt to go jogging instead. If you have been eating out 3x a week then cut back to once a week. If you enjoy going to movies every weekend chose to watch dvd’s at home. It is the little things that matter and these will make a big difference on your bottom line.

Third, cut down your credit cards. You do not need 3 or 4 credit cards. You only need one. So if you own 4 cards cut the other three in half and just leave one for emergency use. Credit cards are not evil. They are neutral. But in the hands of undisciplined people they can be dangerous. If you are not careful they can be the cause of your financial downfall. One disadvantage of using a credit card is that it makes spending much easier. Why? Because you don’t see money disappear. It’s a lot harder to hand over a thousand bucks than your credit card. That is why it is much harder to control yourself when you go shopping with your card. To minimize temptation always buy in cash.

Fourth, save at least 10 % of your income. When it comes to money it doesn’t matter how much you earn. What matters is how much you keep. So every month put away at least 10% of your salary. Never touch it. The only time when you can touch that money is when you are going to invest it. This will allow your money to grow and will provide you with the knowledge that you will never run out of money.

“Amy C. is an interior decoration aficionado and online marketer.  She also likes testing and trying new home and office decorating themes.  In addition to being an interior decoration hobbyist, she enjoys designing calming solar fountains and glass art.  Amy invites you to browse her delightful collection of glass vases”

If your circumstances are simple and straightforward, you can actually draw up your own will with the help of kits that are available for that purpose.  However, for most of us, things are a bit more complicated than that and using a professional to help you with the task is probably the best way of dealing with the matter of drawing up a will.  You will be able to take their expert advice on methods of tax savings to ensure that your estate benefits your loved ones in the most effective manner possible.

If you should die without making a will, your estate will automatically pass to your spouse (if you have one).  If you’re not married but do have a partner, it’s even more important to make sure that you have a will and that your partner will be provided for.

Your will also enables you to stipulate any specific funeral arrangements you would like made (whether you want to be buried and where, whether you would prefer cremation or even allowing your remains to be used for medical research).  Making these sorts of decisions can be extremely difficult for somebody who has lost a loved one and your death will be easier for them to deal with if you have left instructions ready for them.  This is just one of the ways that you will be able to help them to face an uncertain future.

If you have children under 18 years of age, you will be able to appoint guardians who would care for them in the case of the unexpected death of both parents.  This is particularly important as you will need to make sure that you choose people that you would trust to bring up your children and impart to them the values that you would have wished.  You will also need to carefully consider how these guardians would be financially compensated for bringing up your children so that they can carry on living in the manner to which they are accustomed.

In these days of so many second (and even third) marriages and complex extended families, making a will is vitally important.  By making your wishes known and planning for the future of your family, you could actually be ensuring that they need not undergo the stress of the bickering that can result if no clear instructions are left.  Dying intestate could mean that you leave behind family members who are arguing over who should get what and what sort of funeral should be arranged at a time when they could be pulling together to support each other in their time of grief.

Even though you might think that making a will is for later on in life, once you have a family and own property, making a will is vitally important. It’s actually part of the responsibility you bear when you have dependants and not something that should be avoided.

This was a guest post by Debbie on behalf of World First. For up-to-date information on buying property overseas, take a look at World First for Foreign Currency where you will find some great advice on what you should look out for before taking the plunge.